Yha - Unit 04 Quiz (chapters 10 & 11)
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90-Hour Broker Pre-License Course Quizzes
- 1.The legal proceeding or legal action brought by either the buyer or the seller under a purchase contract to enforce the terms of the contract is known as
- A.
An injunction.
- B.
A lis pendens.
- C.
An atttachment.
- D.
A suit for a specific performance.
- 2.If, upon the receipt of an offer to purchase his property under certain conditions, the seller makes a counteroffer, the prospective buyer is
- A.
Bound by his original offer.
- B.
Bound to accept the counteroffer.
- C.
Bound to whichever offer is lower.
- D.
Relieved of his original offer.
- 3.The amount of earnest money deposit is determined by
- A.
The real estate licensing statutes.
- B.
An agreement between the parties.
- C.
The broker's office policy on such matters.
- D.
The mandatory IRS minimum of 5 percent of the purchase price.
- 4.Which of the following gives the best evidence of the buyer's intention to carry out the terms of the real estate purchase contract?
- A.
The "subject to" clause
- B.
The agreement to seek mortgage financing
- C.
The earnest money deposit
- D.
The provision that "time is of the essence"
- 5.An option
- A.
Requires the optionee to complete the purchase.
- B.
Gives the optionee an easement on the property.
- C.
Keeps an offer open for a specified time.
- D.
Makes the seller liable for a commission.
- 6.When a prospective buyer makes a written purchase offer that the seller accepts, then the
- A.
Buyer may take possession of the real estate.
- B.
Seller grants the buyer ownership rights.
- C.
Buyer receives legal title to the property.
- D.
Buyer receives equitable title to the property.
- 7.A broker arrives to present a purchase offer to the seller, an elderly invalid, and finds her ex-husband also present. In the presence of the broker, the ex-husband persistently urges the seller to accept the offer, even though it is much lower than the price she has been asking for her home. If the seller accepts the offer, she may later claim that
- A.
The broker should not have brought her such a low offer for her property.
- B.
She was under undue duress from her former husband, and therefore, the contract is void.
- C.
The broker defrauded her by allowing her ex-husband to see the purchase offer.
- D.
Her consumer protection rights have been usurped by her former husband.
- 8.Which of the following best describes earnest money?
- A.
The consideration for the sale of the property
- B.
The money put up by the buyer at the time the offer is made
- C.
The commission to be paid to the broker
- D.
The money to be used for paying for some of the closing costs
- 9.Money that serves to compensate a seller in the event a buyer defaults is known as
- A.
Actual damages.
- B.
Escrow.
- C.
Earnest money.
- D.
Liquidated damages.
- 10.To assign a contract for the sale of real estate means to
- A.
Record the contract with the county recorder's office.
- B.
Permit another broker to act as agent for the principal.
- C.
Transfer one's rights under the contract.
- D.
Allow the seller and the buyer to exchange positions.
- 11.The Illinois court decision in Chicago Bar Association et al. v. Quinlan and Tyson, Inc. held that
- A.
Licensees have no duty to search for undisclosed latent material defects in a property.
- B.
Real estate licensees may complete preprinted forms, but they may not draft legal documents.
- C.
Multiple-listing services may not establish commission rates.
- D.
A broker may not pay a commission to another broker.
- 12.Two salespeople working for the same broker obtained offers on a property listed with their firm. The first offer was obtained early in the day. A second offer for a higher purchase price was obtained later in the afternoon. The broker presented the first offer to the seller that evening. The broker did not inform the seller about the second offer so that the seller could make a decision about the first offer. Which of the following is true?
- A.
The broker's actions are permissible provided the commission is split between the two salespeople.
- B.
After the first offer was received the broker should have told the salespeople that no additional offers would be accepted until the seller decided on the offer.
- C.
The broker has no authority to withhold any offers from the seller.
- D.
The broker was smart to protect the seller from getting into a negotiating battle over the two offers.
- 13.On Monday the seller offers to sell a vacant lot to the buyer for $112,000. On Tuesday, the buyer counteroffers to buy for $110,500. On Friday the buyer withdraws the counteroffer and accepts the original offer of $112,000. Under these conditions
- A.
There is a valid agreement because the buyer accepted the seller's offer exactly as it was made.
- B.
There is not a valid agreement because the buyer's counteroffer was a rejection of the seller's offer and, once it was rejected, it cannot be accepted later.
- C.
There is a valid agreement because the buyer accpted before the seller advised the buyer that the offer is withdrawn.
- D.
There is not a valid agreement because the seller's offer was not accepted within 72 hours.
- 14.At the time a buyer was negotiating the purchase of a lot on which to build a new home, the seller represented that the soil was firm enough to support the contruction of a building. In fact, the seller knew that any new construction would very likely sink up to fifteen feet below the surface. This contract is
- A.
Void because of fraud.
- B.
Voidable by the buyer because of fraud.
- C.
Voidable by the seller because of the mistake.
- D.
Voidable by neither party because no harm was done yet.
- 15.After the buyer and seller have signed a sales contract, the seller has a change of heart and defaults. The buyer sues the seller. Is this action legal?
- A.
Yes. The buyer can sue for specific performance.
- B.
Yes. According to the statute of frauds, the buyer can sue.
- C.
No. Only the broker would have the right to sue the seller.
- D.
No. The buyer cannot sue the seller under any circumstances.
- 16.The concept that requires that an injured party bring an action within a specific period of time after the injury is
- A.
A variance.
- B.
The statute of limitations.
- C.
The statute of fraud.
- D.
Waiver.
- 17.A real estate sales contract becomes valid or in effect when it has been signed by
- A.
Only the buyer.
- B.
The buyer and seller.
- C.
Only the seller.
- D.
The broker and the buyer.
- 18.The party to whom an offer is being made (the offeree) has the right to
- A.
Reject the offer.
- B.
Revoke the offer.
- C.
Rescind the offer.
- D.
Release the offer.
- 19.Which statement best describes a contract that is voidable?
- A.
The contract has no legal effect.
- B.
The contract is oral.
- C.
The contract may be declared void.
- D.
The contract has not been signed.
- 20.At what age is an Illinois resident considered to be of legal age?
- A.
16
- B.
18
- C.
21
- D.
24
- 21.In Illinois, a deed or contract executed on a Sunday or legal holiday is
- A.
Void.
- B.
Invalid.
- C.
Voidable and unenforceable.
- D.
Valid and enforceable.
- 22.A broker is about to present a written contract to a client. The contract is intended to become a binding real estate contract as soon as the client signs it. How must the contract be headed, under Illinois law?
- A.
Binding real estate contract
- B.
Real estate sale contract
- C.
Contract
- D.
Offer to purchase.
- 23.A buyer and a seller sign a binding sales agreement. Three days before closing, the property is destroyed by a tornado. Under Illinois law, which of the following is true?
- A.
The buyer bears the risk of loss under the common law and must complete the transaction.
- B.
The seller cannot enforce the contract and must return all earnest money to the buyer.
- C.
If the buyer has possession of the property, the buyer is not required to pay the full contract price.
- D.
Once a seller has accepted an offer, the seller is no longer liable for any damages to the subject property.
- 24.When properly recorded in the county where the real estate of the defendant is located, a judgment becomes
- A.
A voluntary lien.
- B.
An involuntary lien.
- C.
A specific lien.
- D.
A juried lien.
- 25.When a company furnishes materials for the contruction of a house and is subsequently not paid, it may file
- A.
A deficiency judgment.
- B.
A lis pendens.
- C.
An estoppel certificate.
- D.
A mechanic's lien.
- 26.Which of the following liens does not need to be recorded to be valid?
- A.
Mortgage lien
- B.
Real estate tax lien
- C.
Judgment lien
- D.
Lis pendens lien
- 27.When a lien against a parcel of real estate may result from a lawsuit currently before the court, one examining the public records would look for
- A.
A chain of title.
- B.
A lis pendens.
- C.
A suit to quiet title.
- D.
A judgment lien.
- 28.A mechanic's lien would be properly classified as
- A.
An equitable lien.
- B.
A voluntary lien.
- C.
A general lien.
- D.
A statutory lien.
- 29.The current market value of a property is $335,000. For tax purposes, it is assessed at 40 percent of market value. The tax rate is $4 per $100 of assessed value. What is the amount of the tax due?
- A.
$5,360
- B.
$5,625
- C.
$5,705
- D.
$5,740
- 30.Under which of the following types of liens can both the real property and the personal property of the debtor be sold to pay the debt?
- A.
Real estate tax lien
- B.
Mechanic's lien
- C.
Judgment lien
- D.
Assessment lien
- 31.Which of the following is a voluntary lien?
- A.
Mortgage lien
- B.
Estate tax lien
- C.
Real estate tax lien
- D.
Judgment lien
- 32.Mechanic's liens are based on
- A.
Federal law.
- B.
State law.
- C.
Common law.
- D.
Case law.
- 33.A buyer defaulted some time ago on a written contract to purchase a seller's real estate. Can the seller sue for damages?
- A.
No. According to the statute of frauds, a seller can never sue the buyer.
- B.
No. According to the law of agency, only the broker can sue the buyer.
- C.
Yes, if the real estate broker gives permission.
- D.
Yes, if the seller is not prohibited from doing so by the statute of limitations.
- 34.A mechanic's lien can be filed against an owner's real estate by
- A.
A real estate agent claiming part of the broker's commission.
- B.
A lumber company furnishing materials ordered by the property owner.
- C.
A real estate broker claiming a commission under a rejected offer.
- D.
An individual who obtained a judgment against the property owner.
- 35.Judgment liens are
- A.
Specific liens.
- B.
Voluntary liens.
- C.
Statutory liens.
- D.
Involuntary liens.
- 36.A property owner contracted to have a heated gazebo constructed on a property. When the heated gazebo was finished, the owner refused to pay for the improvement, and the contractor filed a lien for nonpayment. This lien was most likely a
- A.
General lien.
- B.
Special lien.
- C.
Specific lien.
- D.
Voluntary lien.
- 37.A property owner has defaulted in the payment of several debts, and the court has ordered his property sold to satisfy them. A title search revealed several outstanding lliens against the property. Which of the following liens has first priority?
- A.
The outstanding first mortgage lien dated and recorded one year ago
- B.
The current year's real estate tax lien
- C.
The judgment lien rendered and recorded last month
- D.
The mechanic's lien for work started two months before the mortgage was recorded
- 38.After the state or county sells real estate in order to satisfy a delinquent tax lien, the defaulted owner usually has a right to
- A.
Have the sale canceled by paying the back taxes and penalties.
- B.
Pay the creditors directly and have their liens removed.
- C.
Redeem the property within the time specified by law.
- D.
Record a notice of nonresponsibility for the unpaid taxes.
- 39.Normally, the priority of liens is determined by
- A.
The order in which they are filed or recorded.
- B.
The order in which the cause of action arose.
- C.
The size of the claim.
- D.
The court.
- 40.All of the following are specific liens EXCEPT
- A.
Real estate taxes.
- B.
Judgments.
- C.
Mortgages.
- D.
Mechanic's liens.
- 41.Which of these is a lien on real estate?
- A.
An easement
- B.
A recorded mortgage
- C.
An encroachment
- D.
A restrictive covenant
- 42.A bilateral contract is one in which
- A.
Only one of the parties is obligated to act.
- B.
The promise of one party is given in exchange for the promise of the other party.
- C.
Something is to be done by one party only.
- D.
A restriction is placed in the contract by one party to limit the performance by the other.
- 43.The current value of a property is $340,000. The property is assessed at 40 percent of its current value, with an equalization factor of 1.5 applied to the assessed value. If the tax rate is $4 per $100 of assessed value, what is the amount of tax due on the property?
- A.
$8,640
- B.
$8,160
- C.
$8,600
- D.
$8,240
- 44.What is the difference between a general and a specific lien?
- A.
A general lien cannot be enforced in court, while a specific lien can be enforced.
- B.
A specific lien is held by one person, while a general lien is held by at least two persons.
- C.
A general llien covers all of the debtor's property, while a specific lien covers only a certain piece of real property.
- D.
A specific lien covers real estate, while a general lien covers personal property.
- 45.Which of the following is true of the Illinois homeowner's exemption?
- A.
It exempts all of a homeowner's property from real estate taxes.
- B.
It reduces the assessed value on a place of residence up to $6,000.
- C.
It does not apply to homeowners over the age of 65.
- D.
It reduces the real estate taxes on a place of business.
- 46.Taxes levied on a property owner to help fund the installation of sidewalks or sewers are called
- A.
Ad valorem taxes.
- B.
General property taxes.
- C.
Special excise taxes.
- D.
Special assessments.
- 47.Debts that are incurred by an individual and become liens against all real and personal property owned by that person are
- A.
General liens.
- B.
Specific lliens.
- C.
Fiduciary encumbrances.
- D.
Special assessments.
- 48.Which group is NOT entitled to a lien on property in Illinois?
- A.
Commercial real estate brokers
- B.
Residential real estate brokers
- C.
Subcontractors
- D.
General contractors
- 49.Which of the following is a general lien?
- A.
Ad valorem taxes
- B.
Mechanics' lien
- C.
IRS lien
- D.
Special assessment
- 50.A man owns a principal place of residence and a duplex. He pays the property taxes on his home, but fails to pay the property taxes on the duplex. The man may find that a lien had been placed against his
- A.
Home.
- B.
Duplex.
- C.
Home and duplex.
- D.
Home, duplex, and personal property.
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